Broker tips: SSP, WH Smith, Fevertree
By Michele Maatouk
Date: Friday 12 Sep 2025
(Sharecast News) - SSP rallied on Friday as Berenberg lifted its stance on the Upper Crust owner to 'buy' from 'hold' as it said the share price does not reflect the intrinsic value.
The bank, which upped its price target on SSP to 190p from 180p, said the group has attractive exposure to the US as well as the fast-growing Indian market.
"Moreover, the company's established UK and Ireland (UK&I) business has also delivered strong spend per passenger (SPP) growth.
"Looking ahead to FY26, we expect a material improvement in profitability as the company experiences the benefits of its restructuring programme in France and Germany, and it exits its German motorway business.
"Furthermore, the successful listing of Travel Food Services (TFS; the company's India JV), has demonstrated the inherent value in SSP's Asia-Pacific (APAC) operations."
Berenberg said there is scope for SSP to return capital to shareholders were it to monetise its stake in TFS.
"In our view, SSP's share price does not reflect its intrinsic value; therefore, we upgrade our recommendation to buy."
In the same research note on leisure, Berenberg cut its stance on WH Smith to 'hold' from 'buy' and slashed the price target to 700p from 1,600p as it awaits the outcome of Deloitte's review of the accounts.
"We think that the company's top-line growth profile is stronger today than it was in the past following the sale of its high street and funkypigeon.com businesses," Berenberg said.
"Moreover, we remain of the view that WH Smith's North America exposure is attractive. However, the company's overstatement of headline trading profit by circa £30m last month means the profitability of this growth is now uncertain."
Elsewhere, Deutsche Bank lifted its price target on Fevertree after the posh tonic maker's interim results a day earlier.
The bank hiked the price target to 840p from 800p but maintained the rating at 'hold' as it said the US transition is going well but the rating reflects this.
Deutsche noted that the transition to Molson Coors' national network of around 400 regional distributors, servicing circa 50,000 accounts, started in June.
"This transition is progressing well with the focus in 2H 25 moving to servicing On-Trade and Liquor customers and the handover of relevant Retail customers," it said, adding that diversification continues.
"The broader product portfolio, beyond tonic, including ginger beer and premium soft drinks, is delivering strong growth and now represents 45% of group revenues.
"This diversification strategy has led to a 16% 3-year compound annual growth rate for the broader portfolio," it said, highlighting the company's strong cash position.
"Cash from operations was £12.1m, down from £25.4m LY. The company indicated that it expects a material improvement in cash generation in 2H 25 and beyond reflecting the reduced w/cap requirements of the US business."
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